Skycoin – Chain Analysis

Chain Analysis of Skycoin

CHAIN ANALYSIS

19.01.2020

ANALYSIS OF SKYCOIN TRANSACTIONS

CHRISTIAN OTT

AUTHOR

Introduction

In contrast to many newer projects in the crypto space, the Skycoin blockchain has already been running for several years. All of its transactions can be monitored in Skycoin’s handy blockchain explorer, which also has a feature-rich API. However, the explorer doesn’t contain detailed statistics about the blockchain yet, which is why I decided to create some in-depth statistics and present them to you in this article. The data used for this analysis starts at block 1 (start of Q2 2015) and ends at block 129,032 (end of Q4 2019).

Transaction Growth

Let’s start with the transaction growth over time. Block 1 of Skycoin’s blockchain was issued on April 02, 2015. Nearly five years have passed since then and the transaction volume is steadily growing, though the usage started out rather slow. In 2015, the blockchain registered 262 transactions, which increased to 311 transactions in 2016. That changed in 2017. With increasing public awareness and Skycoin’s first exchange listings, the usage of the network increased during every quarter. In Q2 2017 it was over a thousand transactions for the first time, in Q4 2017 the blockchain registered 4500 transactions. This growth continued in 2018: Q1 had 13k Skycoin transactions, Q2 about 24k transactions, Q3 17k transactions and Q4 2018 an all-time record of 27.6k transactions. The transaction growth slowed down after that, Q1 and Q2 of 2019 each had 13k transactions, while it was just 9k transactions in Q3 and 5k transactions in Q4. Overall, the number of transactions in 2019 have been 6 times higher than in 2017, but have been 50% lower than in 2018.

A great amount of these transactions have been interactions with exchange addresses, such as individual exchange deposit addresses or the exchanges’ withdrawal addresses. In general, 78% of all transactions have been interactions with exchange addresses. Breaking it down to individual exchanges, 59% of all Skycoin transactions have been interactions with Binance and 16% have been interactions with Cryptopia. Just 3% of all Skycoin transactions have been interactions with other exchanges. The recently launched Skycoin-based sports betting service “Moojiebet” already accounts for 1% of all Skycoin transactions. The following graphic summarizes these transaction statistics:

TRANSACTIONS OVER TIMESKYCOIN2015265201631120177,079201882,371201941,689MOOJIEBET1%CRYPTOPIA16%OTHER EXCH.3%BINANCE59%PERCENTAGE OF TRANSACTIONS CAUSED PER ENTITY:

Address Growth

This increase of transactions came alongside an increase in unique addresses, that held a minimum of one Skycoin. At the end of 2015, just 98 addresses held at least one Skycoin. This number increased to 166 addresses at the end of 2016. However, the growth in addresses and therefore the distribution of Skycoin really took off in 2017 after the first exchange listings. In the middle of 2017 the circulating supply of Skycoin was still distributed among 400 addresses, while this number increased to 2,000 addresses at the end of the year. The growth continued during 2018: At the end of Q2 2018 around 7.9k addresses held at least 1 Skycoin, which increased to 10.8k addresses at the end of Q4 2018. As of December 31, 2019 there are 12,054 addresses with at least one Skycoin.

It shows, that Skycoin’s circulating supply is distributed among 30 times as many addresses than it was two and a half years ago and is therefore in an ongoing decentralization process. Furthermore, not only the amount of addresses with at least one Skycoin has been growing but also the amount of addresses with a minimum balance of 100 Skycoin. At the end of 2019, there are over 5,000 addresses with at least 100 Skycoin, which is a 25% growth to one year ago and a 500% increase compared to two years ago. In the graphic below you can see the growth of addresses with at least a balance of 1, 10, 100 and 1000 Skycoin over time:

1433521,6395,8217,9518,7698,812ADDRESSES WITH A MINIMUM OF 10 SKYCOIN OVER TIME1002669622,7834,0425,0635,076ADDRESSES WITH A MINIMUM OF 100 SKYCOIN OVER TIME751844217081,0271,5111,569ADDRESSES WITH A MINIMUM OF 1,000 SKYCOIN OVER TIME2H20161H20172H20171H20182H20181H20192H20191664072,0087,89810,76611,62512,054ADDRESSES WITH A MINIMUM OF 1 SKYCOIN OVER TIMEGROWTH OF ADDRESSESSKYCOIN

Coin Hours over Time

However, Skycoin is not the only asset on Skycoin’s blockchain, it also contains Skycoin’s parallel currency Coin Hours. Coin Hours have both an inflationary and a deflationary side, since every Skycoin generates one Coin Hour per hour (inflationary) but also a certain amount of Coin Hours is burned in each Skycoin transaction (deflationary). In general, the circulating supply of Coin Hours has been growing over time but has also had massive decreases caused by individual transfers that burned a ton of Coin Hours.

At the end of 2015, the circulating supply of Coin Hours was at 6.3 billion while it was at 23.6 billion at the end of 2016. The circulating supply went as high as 29.5 billion on April 6, 2017 until a huge number of 13.5 billion Coin Hours were burned in one transaction: After that, the circulating supply of Coin Hours increased constantly with occasional burns once a “Coin Hour whale” decided to move his Skycoin and therefore burn up to 50% of his Coin Hours. At the end of 2017, there were 27.5 billion Coin Hours in circulation, which increased to 69.7 billion Coin Hours at the end of 2018. At the end of 2019, the circulating supply is at 185 billion Coin Hours.

Looking at these numbers, it may be surprising that a total of 519 billion Coin Hours have already been burned, which is around 2.8x as many Coin Hours as the current circulating supply. The circulating supply of Skycoin (at 17 million SKY at the end of 2019) has only generated 283 billion Coin Hours thus far, however, every time a distribution address with one million SKY is opened, the Coin Hours those one million SKY generated over the past five years can get introduced to the circulating supply. Around 408 billion Coin Hours have been released this way from distribution addresses, though most of them have been burned immediately.

In parallel to the transaction analysis, exchanges are not just responsible for the majority of transactions, they have also burned many Coin Hours over the past three years. A total of 82 billion Coin Hours have been burned in exchange-related transfers, of which 63 billion were burned by Binance, 15 billion by Cryptopia and 4 billion by other exchanges. Check out the following graphic for a visualization of all mentioned Coin Hour statistics:

In this article we discussed several statistics of Skycoin’s blockchain. We saw that Skycoin transactions have been growing over time and reached a peak in Q4 2018. Address growth has been steady as well, with both growing addresses overall and growing addresses with a substantial amount of Skycoin. Looking at Coin Hours, their circulating supply has been growing exponentially over time, even though sudden burns of huge Coin Hour amounts decreased the circulating supply substantially.